As The National newspaper in Scotland has reported, the SNP leadership are presenting a 33 point resolution to their spring conference that, in effect, adopts the report of the Growth Commission that reported last year, excepting on the issue of currency.
I am deeply disappointed for the cause of Scottish independence and Scotland itself. The change on currency that has been proposed is a sop: it drops the commitment to the pound but it does not commit an independent Scotland to its own currency on its first day in existence. The result is that the plan still shackles Scotland to uncertainty. Worse, it leaves open the possibility that the pound will still be used. And that would be a disaster for Scotland as it will have no control over its economic policy, at all, in that case.
I note that amendments to this proposal can be tabled until late this month. I sincerely hope that a much more radical policy alternative will be put to the conference as a result. For the second time this morning I have to note the curse of supposedly left of centre economists who are actually dedicated to the structures of neoliberalism to the enormous cost of the societies that they claim to have close to their hearts.
It's time for the SNP to do three things.
The first is to commit to its own currency.
The second is to base its economic policy on the GND - which suits Scotland better than almost any country on earth given its potential to exploit it to advantage.
And third, it has to make clear that both commitments would represent the real gain from independence, which would be to leave the disastrous economy policies of London behind.
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https://www.telegraph.co.uk/business/2019/03/03/europeans-double-uk-investment-since-brexit-vote/?WT.mc_id=e_DM959243&WT.tsrc=email&etype=Edi_Cit_New_AEM_Daily&utm_source=email&utm_medium=Edi_Cit_New_AEM_Daily_2019_03_04&utm_campaign=DM959243
It would see life will be fine post brexit for the UK..why the rush for Scottish independence? Why are you such an advocate given your not Scottish and don’t live there..are you looking for a paid advisory role?
I suspect the chance of paid advisory work is zero and I am not looking for it
I am interested in Scotland being viable if it is to be independent, as I think it will be
And The Telegraph view is simply absurd
The telegraph isn’t forming an opinion it is stating that investment in the UK from European countries has gone up post the referendum – they are simply stating facts from an independent source.
If you knew anything about FDI data you would know it is mainly tax driven, includes M&A data as investment, and is almost wholly unreliable
“If you knew anything about FDI data you would know it is mainly tax driven, includes M&A data as investment, and is almost wholly unreliable”
Do you feel the need to substantiate this comment or just leaving it there???…and..of course it includes M&A deals..that is part of investment in the UK from overseas!!
The comment is correct
Just do some googling
Oh, and M&A is not investment. It is redirected savings. Not the same thing at all.
Through your definition all investment is redirected savings!!!..Unless of course it is state sponsored.
Any corporate is ultimately financed by equity investors and debt holders..so if a foreign company that opens up a factory in the U.K. that gives job opportunities is “redirected savings”..HSBC having branches here is “redirected savings” on your definition. Well it’s better more of those savings are redirected to the U.K.
No, clearly not
What I am saying is the stats you are relying on do not make your case
What the Telegraph seems to be reporting is the on-going process of selling off UK Plc in order to cover the chronic and huge UK balance of payments deficit. This is something like £130 billion per annum, and unlike the Government deficit it can’t be paid by creating more sterling. So we have been selling our assets, so shares in UK companies, London properties, etc. When Vodafone sold their 50% of Verizon that covered the deficit for about 5 months. Selling The Shard to the Chinese gave us two days. All of this, of course, means the deficit will get gradually worse because now the dividends, rents, etc also have to be paid. In fact when I looked at the 2017 edition of the ONS Pink Book (on UK international capital / income flows, assets and liabilities, etc) then for the first time since before 1800 the UK’s net assets were nil. In other words everything we own (houses in Spain, foreign companies, stashes in the Caymans) was cancelled out by what we owe foreigners or they own here.
Richard is certainly right that the use of the word ‘investment’ is very sloppy. When Gordon Brown ‘invested’ in the health service then 70% of that was higher wages. That is not an investment at all as it is simply consumption. Investment is giving up current consumption in the hope of a return that will lead to higher consumption in the future. Building The Shard is an investment. Changing the ownership is not.
But your argument why you don’t like the stats is “investment is redirected savings”.,
A pension fund or large institutional investor or private equity house is collectively representing the interests private investors savings..do all investment, whether it’s buying BP shares or financing a BP debt issuance (so they can drill for oil) is redirected savings.
So I do not understand your argument. I have mentioned it to a couple of work colleagues and they don’t understand your argument either.
There is no new investment in M&A
There is just redirected savings
So if we’ve been selling assets on the cheap that is n0t new investment from the EU
And maybe you need wiser colleagues
What concerns me is your definition of “investment” and where you think the funding comes from. Ultimately “investment” is either private or state. Where it or private it has to originate from savings. So it follows that anything originating from the private sector isn’t investment??
How wrong you are
Investment is financed by credit, not savings
You really do not know much economics, do you?
Or much about business, come to that
“Investment is financed by credit, not savings..You really do not know much economics, do you?”
I know what you are saying and you are wrapped up in definition, aka injections /leakages from an undergraduate textbook..and if we abide by that it gets nonsensical i.e if an international corporate has retained earnings and invests into the UK in a new plant & employs more people that isn’t “investment” in your sense but “redirected savings” but if they took a bank loan it is..similarly absurd is debt on the balance sheet can take the form of issued debentures – which wouldn’t be” investment” (in your definition) as if is funded by redirected savings but loans from banks would be.
Next time the CEO of a multi national is giving a presentation taking about their investment into the UK and the jobs and prosperity it brings us..you can stick your hand un the air and say “you really do not know what you are talking about” and educate him on the difference between investment through credit and investment through retain earnings…you will be thrown out for being a nuisance..At the end of the day It is coming from overseas so it is an injection into our economy!!!!
No, I am talking macroeconomic fact
You clearly do not understand it
I think the issue you are having is that what is described as ‘investment’ in casual parlance is often not investment so far as an economist is concerned. You may invest in buying a Victorian house, but that is not an investment so far as the macroeconomy is concerned because nothing has changed except who owns the house. Your investment in the house is exactly matched by somebody else’s disinvestment so the net effect is nil. Us selling UK companies or property to foreigners is likewise not investment in economic terms, rather simply a change in ownership. Economically it would be the same effect as exporting a Jaguar car. We no longer own the item and somebody else gets the benefits in future while we (UK Plc) get a bit of one-off cash to help with the BoP deficit.
Well I understood enough about economics to study for degree and a masters.. and to leave the textbook alone and get a real job and that’s what I’ve been doing for 20 odd years..
Your patronising nature does you no favours
You came on here and made an incorrect claim
If you don’t like it being pointed out that is your problem
See the comment piece by George KEREVAN in the National today. Not everyone in the SNP agrees with the ‘Highheidyins’. I certainly don’t think Derek McKay has much knowledge of macroeconomics having argued the currency issue with him face to face at the Business for Scotland dinner last September. I have put myself down as a Dalkeith branch delegate to the April Conference so I will get to vote on it (and hopefully the rest of the Branch delegates too). We will see what we can do about amendments. I think it is only really the currency bit we should focus on changing. The rest probably is probably a bit of a dead letter whether adopted or not since everything will actually change after a vote for Independence and the government at the time will have to do whatever is necessary. So long as the currency issue is sorted correctly then they will be able to do that.
I think you are right to focus on the currency
That’s the core issue
The rest, as you say, is padding right now
My view is that the currency issue is salient one in the birth and sustainability of an independent Scotland.
I love Scotland and have made friends there. I am saddened at the potential loss of the Union, but I’d feel even more sad and pained by seeing it all go wrong for Scotland and her people because the currency issue was unresolved.
The currency issue needs lots of TLC. Pour it on I say.
I don’t disagree with your view Richard, but this will come down to a pragmatic political judgement rather than policy detail – however important that is.
The judgement is on what is likely to win support in order to have the ability to deliver anything an independent state can. If that judgement is that some sort of transitionary period with sterling is required, then that’s what must be offered. In the full knowledge that things can be pragmatically adjusted once the fundamental is delivered.
We can take various views on aspects of UK Labour’s positions on x, y & z which are fine and fair of themeselves, but equally they are of no relvance or import without there being a Labour govt elected to implement anything at all. The situation is hardly disimilar.
Like it or not, many will adopt the “tax before spend”, supposed “deficit” and various other supposedly orthodox positions. Back in 2013/14, there was a veritable deluge of fear inflicted on pensioners about losing their £ pensions – many other similar were poured on thick. It’ll happen again for sure and probably in greater still volumes given that Yes is in clearer sight. Those votes matter a great deal plainly enough.
What you do (Richard) is policy, what the SNP and Greens have to do is politics – not the same thing by any means, even if not entirely disconnected.
There’s no guarantee that the SNP itself would survive a Yes vote into govt to deliver stated policy. Probably would, but it’s not certain. For many it’s a vehicle with the obvious objective rather than their ideal political party of government – and that’s fair enough.
We can argue and agree till we’re blue in the face, but the politics to deliver the power to deliver are sine quae non.
For those attacking your positive view of Ind for Scotland, their view is understandable, it’s a long-lasting Union.
The UK’s political disintegration will be sad in many ways, but there is a solution to that – reform the UK. Make it worth staying in. Let’s see some fairness for N England, for Merseyside and South Wales too … . Where has any of that been? But perhaps alas for those, those are not countries, Scotland is – and arguably longer established as such than England. The UK political system seems chronically incapable of substantive change and reform. What it is designed to do is just a bit obvious – when the formal titles of two chief positions are 1st and 2nd Lords Commissioner of the Treasury and the population are not even worth an annual “state of the nation” speech or accounting to.
How can we change it together? I have no idea – and that’s the problem. It’s always so much in the favour of its incumbents to change nothing substantively that … There is no mechanism and seemingly no will amongst the English population. What other options are open to Scotland to forge a different future? There are none. We cannot shift the UK politically – we are so outnumbered.
But get this …, I don’t need a licence from the Palace to enjoy a cup of tea. Nothing from No10 is needed for a Welsh pastie, to dance an Irish jig or skewer a Cumberland sausage. And if you guys elsewhere want to wear tartan skirts and eat deep fried Mars Bars, no one anywhere can stop you! These are the things which really bind us – not the hot air from politicians. Those things are going nowhere. We’re not enemies and we’re not rejecting English people – get over that pro-Union propaganda, it’s a dribbling nonsense.
You and we may go our different governmental ways, but they will never take any of our sausage rolls!!
We’ll all be just fine in all the important ways, so don’t worry about it. And we might even be able to kick London politics where it matters – offering you guys a lighthouse towards the change which you so badly need also. (smiles).
Dear Richard
I have followed your excellent work for some years now. Thank you for your major contribution to British transparency. Following on from your post about the future of Scotland can I say that I’m amazed that SNP have asked so few questions about the British subsidies to the twelve tax havens. Do you know if there exists a good estimate of how much each tax haven is subsidised by the UK govt? I know you have outline the tax subsidies to the Isle of Man but that does not include security, policing and judicial support amongst other things. Are these figures available somewhere do you know?
There has been no attempt at an official estimate since the NAO looked at the issue in 2007, as I recall